Morrisons pre-tax profit halves as CEO David Potts announces closure of 11 superstores

Pre-tax profits at UK supermarket Morrisons almost halved in the six months to 2 August as the company announced the closure of over 150 stores.

Compared to the year before, the grocer's pre-tax profit was down more than 47% to £126m (€173m, $193.5m) while like-for-like sales in the first half slipped by 2.7%.

David Potts, the former Tesco man who was appointed chief executive at Morrisons in March, told investors: "There is a lot for us to do. The immediate priority is to deliver a better shopping trip to stabilise trading performance.

"Our six strategic priorities will then deliver improvement in the core supermarkets, where we have the greatest opportunity."

Morrisons, one of the Big Four UK supermarkets, said it would close 140 of its convenience stores on Wednesday (9 September), the day before its half yearly results. On Thursday, the company informed investors on the additional closure of a further stores.

The convenience stores generated heavy losses for the grocer, totalling £36m in the 2014/15 financial year. The £26m sale to an investment group led by retail entrepreneur Mike Green and backed by long-term investment firm Greybull Capital will be a £30m loss for Potts's company.

The streamlining efforts are the tip of the iceberg of the chief executive's restructuring plans, which have already resulted in changes in executive management and a promise of £1bn cost-saving efforts, of which almost £200m has been delivered in the first half.

The supermarket's share price has lost more than 40% in the last two years as the company, like many in the UK grocery business, struggles to compete with German budget competitors Aldi and Lidl.

The grocer has also been criticised for its poor shopping experience and disappointing own brand.

Potts looked at the future of Morrisons saying: "It will be a long journey. We approach the challenge with energy, confidence and many strengths, particularly our strong balance sheet and cash flow, which enables investment in improving the customer shopping trip."